US probes French plan for tax on tech companies
The Trump administration has launched an investigation into French plans to bring in a special tax targeting big technology companies, which could result in the US imposing trade tariffs on Paris.
Robert Lighthizer, the US trade representative, announced on Wednesday that the US will conduct a so-called Section 301 investigation into the tax, which it believes will be an unfair barrier to US exports.
The digital services tax, which is up for a vote in the French senate on Thursday, would be set at 3 per cent of the turnover of companies with digital business models and revenues of more than €750m globally and €25m in France.
It would affect about 30 companies, including US groups Alphabet, Apple, Facebook and Amazon, companies from China, Germany, Spain and the UK, and one French company: the advertising platform Criteo.
Mr Lighthizer said: “The United States is very concerned that the digital services tax which is expected to pass the French Senate tomorrow unfairly targets American companies.
“The president has directed that we investigate the effects of this legislation and determine whether it is discriminatory or unreasonable and burdens or restricts United States commerce.”
The US conducted a Section 301 investigation in 2017 before raising tariffs on China. Washington must first seek a negotiated settlement with Paris, though one person briefed on the administration’s plans said US officials were considering raising tariffs on French wine or cars if no agreement can be reached.